House prices in the Valdosta Metropolitan Statistical Area (MSA) continue to drop, and housing sales are still half what they were in 2007, says Forbes. Why do we need to build more subdivisions now?
Morgan Brennan wrote for Forbes yesterday, Cities Where Home Prices Are Still Getting Hammered,
In 2007 when the housing bubble first began to burst across the Sun Belt, Valdosta, like other Georgia cities, seemed somewhat immune. “We didn’t see decreases in our market until around 2009,” says Missy Sherwood, an associate broker for Coldwell Banker Premier Real Estate in Valdosta, a metropolitan area of 140,000 about halfway between Atlanta and Orlando. Once the housing downturn did take root in the area, though, prices began a 13% downward march, as the jobs market contracted, the foreclosure rate ballooned and buyer demand waned.
Today Valdosta homes are still losing value: prices dropped 7% from October 2011 through September 2012 and they are projected to shed another 4% over the next 12 months. The area has an unemployment rate of 8.3% — higher than the national 7.9% average. Scheduled defense spending cuts wrapped in the looming fiscal cliff could have a negative impact on the local economy as well. “We still have more houses on the market than buyers right now. It’s definitely a buyer’s market,” concedes Sherwood, even as she clings to hopes that the market will begin to balance itself out in 2013.
Valdosta is one of four Georgia metro areas
— along with Gainesville, Atlanta, and Columbus — where home prices have not only fallen this year but are likely to continue to drop throughout the next 12 months.
“Nationally we have been hearing that the housing recovery is under way and prices are rising, but there are very few places where that’s actually true,” says Ingo Winzer, founder and president of Local Market Monitor, a Cary,N.C.-based real estate research company. Of the 316 housing markets Local Market Monitor tracks, only 120 welcomed positive price appreciation this year (and most, by a tiny 1-2%). “There are a lot [of places] that are still very near the bottom and some where prices are still falling.”
Most of the major housing reports peg their price indexes to the largest U.S. cities in terms of population. Looking at major hubs like San Francisco, Washington, D.C., Miami, Phoenix and Dallas, it’s easy to see why economists trumpet rosy recovery projections and laud price appreciation. But real estate is incredibly local and while many major cities have begun to show signs of life, that nascent rebound has yet to manifest in many smaller markets — like Valdosta….
In Valdosta the number of foreclosure filings increased 21% in October versus the same time last year; in Gainesville activity jumped 28%. Lenders in Georgia have saturated the marketplace with a tremendous amount of foreclosure inventory this year, causing a dramatic drop in prices across the state.
Kind of makes you wonder why there’s any urgency in even considering rezoning or changing the zoning code to put a subdivision near Moody AFB.